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[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 5120 Introduced in Senate (IS)]

<DOC>

118th CONGRESS
  2d Session
                                S. 5120

 To amend the Internal Revenue Code of 1986 to provide tax incentives 
 for the establishment of grocery stores in certain underserved areas.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                           September 19, 2024

  Mr. Ossoff introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
 To amend the Internal Revenue Code of 1986 to provide tax incentives 
 for the establishment of grocery stores in certain underserved areas.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fresh Food Act''.

SEC. 2. TAX INCENTIVES FOR ESTABLISHMENT OF GROCERY STORES IN CERTAIN 
              UNDERSERVED AREAS.

    (a) In General.--Chapter 1 of the Internal Revenue Code of 1986 is 
amended by inserting after subchapter V the following new subchapter:

 ``Subchapter W--Tax Incentives for Grocery Stores in Underserved Areas

``Sec. 1400. Increased work opportunity tax credit.
``Sec. 1400A. Credit for sales of fresh fruits, vegetables, meat, and 
                            dairy.
``Sec. 1400B. Definitions.

``SEC. 1400. INCREASED WORK OPPORTUNITY TAX CREDIT.

    ``(a) In General.--In the case of an individual employed in the 
trade or business of operating a new underserved area grocery store (as 
certified by the designated local agency (as defined in section 
51(d)(12)), the limitation otherwise in effect under section 51(b)(3) 
with respect to such individual shall be increased by $1,000.
    ``(b) Alternative Certification.--The Secretary may provide for 
alternative methods for certification of an individual described in 
subsection (a) in such manner as the Secretary (in coordination with 
the head of any relevant Federal agency) determines appropriate.
    ``(c) Termination.--Subsection (a) shall only apply to wages paid 
in taxable years beginning after December 31, 2024, and before January 
1, 2031.

``SEC. 1400A. CREDIT FOR SALES OF FRESH FRUITS, VEGETABLES, MEAT, AND 
              DAIRY.

    ``(a) In General.--For purposes of section 38, the underserved area 
grocery store fruits, vegetables, meat, and dairy credit determined 
under this section for the taxable year is an amount equal to the 
applicable percentage of the cost of goods sold by the taxpayer with 
respect to the retail sale of fresh fruits, vegetables, meat, and dairy 
in the trade or business of operating a new underserved area grocery 
store.
    ``(b) Cost of Goods Sold.--For purposes of subsection (a), the cost 
of goods sold with respect to any taxable year is the total amount (as 
determined under the method of accounting of the taxpayer) of purchases 
made by the taxpayer for goods acquired for resale and sold during such 
taxable year.
    ``(c) Applicable Percentage.--
            ``(1) In general.--For purposes of subsection (a), the 
        applicable percentage shall be--
                    ``(A) in the case of any new underserved area 
                grocery store which is placed in service during a 
                taxable year which includes the date on which the 
                Secretary determines (pursuant to section 1400B(3)(C)) 
                that the area in which such grocery store is located 
                qualifies as an underserved area, or which is placed in 
                service during a taxable year beginning after such 
                date--
                            ``(i) with respect to the taxable year in 
                        which such grocery store is placed in service, 
                        30 percent,
                            ``(ii) with respect to the taxable year 
                        subsequent to the taxable year described in 
                        clause (i), 30 percent,
                            ``(iii) with respect to the taxable year 
                        subsequent to the taxable year described in 
                        clause (ii), 28 percent,
                            ``(iv) with respect to the taxable year 
                        subsequent to the taxable year described in 
                        clause (iii), 26 percent, and
                            ``(v) with respect to any taxable year 
                        subsequent to the taxable year described in 
                        clause (iv), 0 percent, or
                    ``(B) in the case of any new underserved area 
                grocery store which was placed in service during a 
                taxable year which ended prior to the date on which the 
                Secretary determines (pursuant to section 1400B(3)(C)) 
                that the area in which such grocery store is located 
                qualifies as an underserved area--
                            ``(i) with respect to the taxable year 
                        which includes such date, 30 percent,
                            ``(ii) with respect to the taxable year 
                        subsequent to the taxable year described in 
                        clause (i), 28 percent,
                            ``(iii) with respect to the taxable year 
                        subsequent to the taxable year described in 
                        clause (ii), 26 percent, and
                            ``(iv) with respect to any taxable year 
                        subsequent to the taxable year described in 
                        clause (iii), 0 percent.
            ``(2) Bonus for locally sourced fruits, vegetables, meat, 
        and dairy.--For purposes of subsection (a), in the case of any 
        taxable year described in paragraph (1) (with the exception of 
        any taxable year described in subparagraph (A)(v) or (B)(iv) of 
        such paragraph), the applicable percentage for such taxable 
        year shall be increased by 5 percentage points with respect to 
        any fresh fruits, vegetables, meat, and dairy which are 
        sourced--
                    ``(A) from any location within the same State in 
                which the new underserved area grocery store is 
                located, or
                    ``(B) from any location which is within a 100-mile 
                radius of the new underserved area grocery store.
    ``(d) Termination.--Subsection (a) shall only apply to taxable 
years beginning after December 31, 2024, and before January 1, 2031.

``SEC. 1400B. DEFINITIONS.

    ``For purposes of this subchapter--
            ``(1) Fresh fruits, vegetables, meat, and dairy.--
                    ``(A) In general.--Subject to subparagraph (B), the 
                term `fresh fruits, vegetables, meat, and dairy' means 
                any product of agriculture (as defined in section 3 of 
                the Fair Labor Standards Act of 1938 (29 U.S.C. 
                203(f))) which is suitable for human consumption.
                    ``(B) Exclusion of canned or frozen foods.--The 
                term `fresh fruits, vegetables, meat, and dairy' shall 
                not include any product described in subparagraph (A) 
                which is canned or frozen.
            ``(2) New underserved area grocery store.--
                    ``(A) In general.--The term `new underserved area 
                grocery store' means any building of the taxpayer if--
                            ``(i) not more than 80,000 square feet of 
                        such building is used for selling items at 
                        retail,
                            ``(ii) at least 25 percent of the square 
                        feet of such building which is used for selling 
                        items at retail is used for selling fresh 
                        fruits, vegetables, meat, and dairy,
                            ``(iii) at least 25 percent of the gross 
                        sales of items sold at retail from such 
                        building are attributable to sales of fresh 
                        fruits, vegetables, meat, and dairy, and
                            ``(iv) such building is located in--
                                    ``(I) an underserved area (as 
                                determined by the Secretary under 
                                paragraph (3)(C) after December 31, 
                                2024), or
                                    ``(II) a rural area (as defined in 
                                section 343(a)(13)(A) of the 
                                Consolidated Farm and Rural Development 
                                Act (7 U.S.C. 1991(a)(13)(A)).
                    ``(B) Malls and shopping centers.--
                            ``(i) In general.--For purposes of 
                        subparagraph (A), the term `building' includes 
                        any portion of a larger building or structure 
                        (such as a mall or shopping center)--
                                    ``(I) which is owned, leased, or 
                                occupied by the taxpayer, and
                                    ``(II) in which the taxpayer, as 
                                part of its trade or business, makes 
                                retail sales of fresh fruits, 
                                vegetables, meat, and dairy.
                            ``(ii) Application of requirements.--In the 
                        case of any portion of a larger building or 
                        structure described in clause (i), the 
                        requirements under clauses (i) through (iii) of 
                        subparagraph (A) shall be applied solely with 
                        respect to such portion and not with respect to 
                        the larger building or structure described in 
                        such clause.
                    ``(C) Duration of status.--
                            ``(i) Underserved area.--In the case of any 
                        building which is described in clauses (i) 
                        through (iii) of subparagraph (A) and is in 
                        operation during a period in which the 
                        Secretary has determined (pursuant to paragraph 
                        (3)(C)) that the area in which such building is 
                        located qualifies as an underserved area, such 
                        building shall not fail to satisfy the 
                        requirement described in subparagraph 
                        (A)(iv)(I) solely by reason of the area in 
                        which such building is located subsequently 
                        ceasing to be an underserved area.
                            ``(ii) Rural area.--In the case of any 
                        building which is described in clauses (i) 
                        through (iii) of subparagraph (A) and is in 
                        operation during a period in which a 
                        determination is made after December 31, 2024, 
                        that the area in which such building is located 
                        qualifies as a rural area, such building shall 
                        not fail to satisfy the requirement described 
                        in subparagraph (A)(iv)(II) solely by reason of 
                        the area in which such building is located 
                        subsequently ceasing to be a rural area.
            ``(3) Underserved area.--
                    ``(A) In general.--The term `underserved area' 
                means any population census tract in which--
                            ``(i) not less than 500 people, or 33 
                        percent of the population of such tract, 
                        reside--
                                    ``(I) in the case of a tract 
                                located within a metropolitan area, 
                                more than 1 mile from a building which 
                                satisfies the requirements in clauses 
                                (i) through (iii) of paragraph (2)(A), 
                                or
                                    ``(II) in the case of a tract not 
                                located within a metropolitan area, 
                                more than 10 miles from a building 
                                which satisfies the requirements in 
                                clauses (i) through (iii) of paragraph 
                                (2)(A),
                            ``(ii) the poverty rate for such tract is 
                        at least 20 percent, and
                            ``(iii)(I) in the case of a tract not 
                        located within a metropolitan area, the median 
                        family income for such tract does not exceed 80 
                        percent of statewide median family income, or
                            ``(II) in the case of a tract located 
                        within a metropolitan area, the median family 
                        income for such tract does not exceed 80 
                        percent of the greater of statewide median 
                        family income or the metropolitan area median 
                        family income.
                    ``(B) Areas not within census tracts.--In the case 
                of an area which is not tracted for population census 
                tracts, the equivalent county divisions (as defined by 
                the Bureau of the Census) shall be used for purposes of 
                determinations of underserved areas under this 
                paragraph.
                    ``(C) Determination of underserved area.--For 
                purposes of determining whether a population census 
                tract qualifies as an underserved area for purposes of 
                this paragraph, the Secretary shall make such 
                determinations in coordination with the Secretary of 
                Agriculture in such manner as is determined 
                appropriate, including use of the Food Access Research 
                Atlas established by the Department of Agriculture.
                    ``(D) Metropolitan area.--The term `metropolitan 
                area' has the same meaning given the term `metropolitan 
                statistical area' under section 143(k)(2)(B).
                    ``(E) Regulations and guidance.--Not later than 6 
                months after the date of enactment of the Fresh Food 
                Act, the Secretary shall issue such regulations or 
                other guidance as may be necessary or appropriate to 
                carry out the purposes of this paragraph.''.
    (b) Credit To Be Part of General Business Credit.--
            (1) In general.--Section 38(b) of the Internal Revenue Code 
        of 1986 is amended by striking ``plus'' at the end of paragraph 
        (40), by striking the period at the end of paragraph (41) and 
        inserting ``, plus'', and by adding at the end the following 
        new paragraph:
            ``(42) the underserved area grocery store fruits, 
        vegetables, meat, and dairy credit determined under section 
        1400A.''.
            (2) Specified credits.--Section 38(c)(4)(B) of such Code is 
        amended--
                    (A) in clause (xi), by striking ``and'' at the end,
                    (B) in clause (xii), by striking the period at the 
                end and inserting ``, and'', and
                    (C) by adding at the end the following:
                            ``(xiii) the credit determined under 
                        section 1400A.''.
    (c) Clerical Amendment.--The table of subchapters for chapter 1 of 
the Internal Revenue Code of 1986 is amended by inserting after the 
item relating to subchapter V the following new item:

   ``subchapter w. tax incentives for grocery stores in underserved 
                                areas''.

    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2024.
                                 <all>
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